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Articles Posted in Whistleblower award

The SEC announced an award of over $7 million split among three (3) whistleblower who helped the SEC litigate an investment scheme.

The SEC began their investigation when one of the whistleblowers provided a tip to the SEC.  The initial whistleblower will receive more than $4 million for his initial information, per the SEC.  During the SEC’s investigation, the two other whistleblowers together provided new information that significantly contributed to the SEC’s successful enforcement action.  The two other whistleblowers will split more than $3 million for the information they provided to the SEC.

According to the SEC, the tips provided by various whistleblowers have resulted in almost $1 billion in financial remedies, a great amount given that the program was established less than five years ago.

How the Investment Management Firm BlackRock Undermined Whistleblower Incentives on

Firm managing $5.1 trillion is forced to change improper employee whistleblower policy

Until recently, the world’s largest investment management firm forced ex-employees to sign away their rights to potential whistleblower awards in order to receive employee separation package payments. BlackRock, Inc., which has 30 offices in 70 countries, was charged by the SEC and fined $340,000 for the illegal policy, which is alleged to have affected more than 1,000 employees.

BlackRock’s controversial policy, which the SEC alleged was retaliation for a new rule improving whistleblower awards, isn’t the only example of a financial firm attempting to discourage current or former employees from blowing the whistle.

The Securities and Exchange Commission (the “SEC”) announced an award of more than $5.5 million to a whistleblower who provided pertinent information that helped the SEC uncover an ongoing scheme on January 6, 2017.

According to the SEC’s order, the whistleblower was employed at the company involved in the wrongdoing.  The whistleblower proceeded to report the information directly to the SEC, which brought a successful enforcement action to end the scheme.

Enforcement actions from whistleblower tips have resulted in more than $904 million in financial remedies according to the SEC’s whistleblower main page.  The SEC whistleblower has awarded approximately $142 million to 38 whistleblowers since issuing its first award in 2012.

The Securities and Exchange Commission (the “SEC’) announced on December 5, 2016 that it had awarded a whistleblower approximately $3.5 million for coming forward with information that led to an SEC enforcement action.

The $3.5 million whistleblower award brings the total amount awarded to whistleblowers to $135 million to 36 whistleblowers.  In addition to the amount awarded to whistleblower, the SEC has collected over $874 million in financial remedies through enforcement actions brought about by whistleblower tips.

Under the SEC whistleblower program, established by the Dodd-Frank Act in 2011, the SEC is required to ardently protect confidentiality of whistleblowers and cannot disclose information that might indirectly or directly reveal a whistleblower’s identity.

The Securities and Exchange Commission announced on September 20, 2016 an award of over $4 million to a whistleblower.  The whistleblower’s original information alerted the SEC to a fraud.

The SEC whistleblower program was established by Congress in 2011 to incentivize whistleblowers with specific, timely and credible information about federal securities laws violations to report to the SEC.  Since its inception, the SEC whistleblower program has awarded more than $111 million to 34 whistleblowers.

The SEC lays out the process for a whistleblower.  First, a whistleblower submits a tip to the SEC.  The SEC will then analyze and investigate the tip.  A case will be filed if the tip is fruitful to the SEC and penalties will be ordered.  Notices of the covered actions will then be posted, and the whistleblower will file a claim.  Once the SEC determines the award, between 10 and 30 percent of what the SEC collected when monetary sanctions exceed $1 million, a payout will be made to the whistleblower from the Investor Protection Fund.

On August 30, 2016, the Securities and Exchange Commission (“SEC”) announced the award of more than $22 million to a company insider whistleblower.

According to the SEC order, the SEC determined the whistleblower’s tip and extensive assistance helped the agency stop a well-hidden fraud at the whistleblower’s employing company.

The $22 million-plus award is the second-largest total the SEC has awarded a whistleblower.  The largest award was $30 million, and it was awarded in 2014.

us-dollars-moneyThe Securities and Exchange Commission has awarded at least $8.95 million to four whistleblowers in May 2016.

The first award was on May 13, 2016, when the SEC awarded a whistleblower $3.5 million for providing a tip that strengthened the SEC’s case in an ongoing investigation.  According to the order determining the whistleblower award claim, the tip helped give the SEC leverage in settlement negotiations with the bad-acting party.

A few days later on May 17, 2016, the SEC announced it would award between $5 million and $6 million to a former company insider whose tip led the SEC to uncover securities violations that would have been nearly impossible for it to discover without the whistleblower’s information.  That award, according to the press release, is the SEC’s third highest to a whistleblower.

1st-place-1238508The U.S. Commodity Futures Trading Commission (“CFTC”) announced on April 4, 2016 an award of more than $10 million to a whistleblower who provided important, original information that led to a successful CFTC enforcement action.

The award is the largest made by the CFTC’s whistleblower program, according to a CFTC press release.

The CFTC whistleblower program, like the SEC’s program, was created by the 2010 Dodd-Frank Act.  It allows for payment of monetary awards to whistleblowers who voluntarily provide the CFTC with original information about violations of the Commodity Exchange Act (“CEA”) that lead the CFTC to bring an enforcement action that results in more than $1 million in sanctions.  The total amount of the whistleblower award, according to the CFTC’s program website, is between 10 and 30 percent of the monetary sanctions collected in the CFTC action.

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